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Puerto Rico passes 100% renewable energy legislation

By on March 25, 2019

(CB photo)

Heads to the governor for enactment

SAN JUAN – Puerto Rico’s House of Representatives passed Monday the final version of the Energy Public Policy Act, which will now be sent to Gov. Ricardo Rosselló for enactment.

The passage of a regulatory framework, which calls for Puerto Rico to use 100% renewable resources by 2050, had been delayed by nearly three months since the original December 2018 deadline, in the process of transforming the island’s energy utility.

The two legislative chambers passed different versions of the energy regulatory framework in January and were forced to work out their differences in a conference committee to create a single version of the bill. The Senate concurred with the bill a few weeks ago but the House took longer in voting for a final version.

Javier Rúa, public policy director of Sunrun, which does business in Puerto Rico through New Energy Solar, Maximo Solar and Windmar said Senate Bill 1121 is a great step forward. Among its benefits, Rúa said the bill calls for small solar energy systems to be connected to Prepa as soon as an engineer certifies it. In the past, these systems had to wait months for interconnection.

The legislation also calls for Prepa to quickly activate net-metering, or the process by which the Puerto Rico Electric Power Authority (Prepa) purchases excess energy produced by a consumer. It establishes automatic interconnection and net-metering for systems under 25 kilowatts. The connection of larger systems must be approved within 90 days.

“Often, it takes years for net-metering to start,” Rúa said.

More importantly, the bill protect net-metering for five years and allow new clients to be grandfathered in for the next 20 years, so they will not be impacted by rate changes.

“This is a bill that is bipartisan, which makes it immune to changes,” Rúa stressed.

In a statement, the Solar and Energy Storage Association of Puerto Rico (SESA-PR) lauded the legislature for passing the bill.

“Once signed by Governor Ricardo Rosselló, Puerto Rico will join Hawaii and California in establishing a transition to 100 percent renewable energy,” the group said.

“Policymakers have listened to the solar and storage industry leaders’ input every step of the way while developing this historic legislation,” said PJ Wilson, president of SESA-PR. “SB 1121 eliminates many of the barriers that have frustrated solar deployment at all levels for years and creates a clear vision for ramping up clean energy, but actually implementing the law will require strong continued collaboration as Puerto Rico’s power grid transforms from 97% imported fossil fuel dependence to 100% local clean energy.”

What else does the final version of the bill contain?

It allows for the replacement of coal-burning plants with any other fuel as a transition toward 2028, when burning coal for energy will be banned. Also, it allows for certain contracts, such as AES Puerto Rico’s, that generate 17% of the island’s electricity using coal, to be amended if the plant is modified to use renewables.

The final language establishes that an agreement with creditors to restructure the public utility’s $9 billion debt be superseded by the public policy. Lawmakers eliminated language that would have allowed waste-to-energy plants and the use nuclear energy.

Another important provision is that the bill will not impose any taxes on solar and wind systems.

“The bill will not have any discriminatory fee,” Senate Vice President Larry Seilhamer said.

The approval of the bill comes days after members of the liquefied natural gas industry met in Puerto Rico to discuss opportunities on the island, to the ire of those who want Prepa to focus on renewables.

Prepa Executive Director José Ortiz said the utility will use natural gas as a transition to renewables, arguing that the technology, although advancing, is currently too expensive. Washington Resident Commissioner Jenniffer González said there was no reason why Puerto Rico could not become a Caribbean hub for natural gas.

Meanwhile, the Puerto Rico Energy Bureau called for Prepa to revise its integrated resource plan, which includes several natural gas projects.

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